two out of five shares cost more

After after $2.30

Someone who pays $2.40 for their shares today will in fact have paid $2.575 for them in the new company.

It works a bit like this.

Under the deal Brian Gilbertson and Pallinghurst will get $1.38 per share PLUS for every 5 shares you originally owned you will get 2 shares in the new csm.

Ok

At $2.30 in the old CSM you will get a share worth $2.30 in the NEW CSM

5 shares @ $2.30 = $11.50

That is what you might have paid today.

Under the new CSM you will be getting for what you paid for.

$6.90 (5 x 1.38)
PLUS for 5 of your old csm shares you will get 2 new ones

2 x 2.30 = 4.60

4.60 + 6.90 = 11.50 in the new csm

At 2.30 you are buying 11.50 worth of shares and getting 11.50 in the old company.

But look what happens if you buy at any price about 2.30

say 2.40

5 x 2.40 = 12 worth in the old csm

in the new CSM you will get
1.38 x 5 = 6.90
plus 2 for 5
(2 x 2.40) = 4.80

4.80 + 6.90 = 11.70

that is 30 cents less than what you paid for the shares

you have in actual fact paid 15 cents more for your shares in new company

So if you bought at 2.40 today you have actually paid 2.55 each for your two shares in the new csm.

the next question is - will these two new shares be worth more than 2.55?

People who are buying at 2.40 must think 2.55 in new csm will be good value